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◆ Sovereign rides post-EU momentum, beats size target ◆ Deal priced flat to fair value ◆ Thuringia oversubscribed but Länder books shrink
French government vote and EU syndication to shape market in coming days
◆ Other recent German deals finished uncovered ◆ RV against KfW was important ◆ Some argue outcome 'not great'
◆ Third SSA in a week gets low demand ◆ Starting level 'seemed good approach' but fails to draw appetite ◆ Coupon level gives hope in secondary trading
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High grade bond markets have made a flying start to the year, defying the expectations of a bear market in fixed income following the end of the European Central Bank’s asset purchase programme and tightening of monetary policy in the US. Instead of the expected cautious tone, investors have been fuelling record order books, big deals and strong performance in the secondary markets, write Burhan Khadbai and Nigel Owen.
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The Province of Ontario will this Friday be the fourth SSA from Canada to visit a very strong dollar market this week, after CPPIB Capital printed on Monday, Alberta on Tuesday and the sovereign made a rare visit on Thursday. Dexia Crédit Local also printed in the currency on Thursday and SSA bankers are confident of more supply next week.
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Public sector borrowers printed over $10bn of bonds on Tuesday in a dollar market that SSA bankers expect to keep its momentum in the weeks ahead.
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Cultured, guitar-playing capital markets banker who was widely seen as the best SSA originator in the business died on December 26. He was 48 and had been suffering from cancer.